Hunts Point Produce Market Unveils New Marketing/PR Campaign At The New York Produce Show And Conference
Jim Prevor’s Perishable Pundit, November 8, 2010
The Hunts Point Market is probably the most misunderstood institution in our industry. Retailers often think they save money by cutting out the middleman, but there is a great deal of doubt about that point. It is not only a matter of price… retailers who buy with the intent of avoiding purchases from the market inevitably over order. This means they have higher shrink than they need to. It also means that they are tempted to hold off on buying fresh product so they can use up inventory, and this means their customers don’t get as fresh a product as they could.
Most retailers would be better off ramping down their direct purchases a bit on most items. They would actually sell more by always having fresh product. In most of the country this would be impossible — there are no independent wholesalers that are stocked with enough produce to be relied upon as a source for most large retailers. Hunts Point and a few other markets can really serve that purpose.
Shippers also sometimes misunderstand the value of Hunts Point to their business. Sure, very often, the returns that shippers get may be lower than other sales, but those other sales are only possible because Hunts Point is there to take the unsold volume. In other words, many shippers sell all they can to their retail customers, to the foodservice distributors and to smaller wholesalers. Then, on the few markets that can handle volume, they ship what is left sometimes on a consignment or price-after-sale basis.
When the shippers send this product off they realize that if they go back to the chain store that booked 10 loads and ask the chain buyer to buy 20 loads, if the chain would do it at all, the chain buyer will want a cheaper price on all the loads, including those already purchased, so the chain can go on sale with the item to move the extra loads.
Unfortunately by the time the account sales is done or the price-after-sale negotiated, shippers sometimes forget the reason they sent those loads to Hunts Point and forget that this was all extra income above and beyond what they were able to sell to other customers.
In truth, retailers can never fully replace markets because retailers buy what they want — they pick the size, the variety, the grade — whereas wholesale markets such as Hunts Point help growers sell what they need to. This is a great public service.
In fact, politicians who inevitably make markets a low priority would do well to realize their function. They are the distribution centers for small and midsize retailers, restaurants and the purveyors who supply them. So if we want an entrepreneurial society, where the path to upward mobility is available to everyone, including the dynamic new generation of ethnic retailers and restaurateurs, we have to make sure that the distribution centers that these entrepreneurs rely on are a competitive edge. This means that a top urban priority should be to have world class terminal markets.
And in an age where seemingly everyone wants to support local growers and diverse agriculture, only a vibrant terminal market can help those local growers go beyond the very limited sales they can do direct to consumer.
There are still a number of American cities with vibrant terminal markets, but the scale on which Hunts Point operates makes it unique. Many grower/shippers and retailers who don’t have operations in New York have street buyers or buying brokers who pick up fill-in items; the retailers can buy many specialty imported items that are not commonly available elsewhere; the retailers can take advantage of special opportunities when market prices diverge from the FOB. Even grower/shippers use the high volume on the market to pick up product when they are short in order to meet commitments and cover customer needs.
The truth is that the market and the people on it are misunderstood and don’t get the respect they deserve. Now, this colossus of produce marketing is stirring and about to do some marketing of its own, a kickoff of which is taking place at The New York Produce Show and Conference, which includes a special tour of the market.
We asked Pundit Investigator and Special Projects Editor Mira Slott to find out more:
President of Joseph Fierman & Son
Bronx, New York
Q: Hunts Point Terminal Market has long been a cornerstone of the New York produce scene. What is driving the new marketing campaign on its behalf? We thought it ideal to highlight your efforts as chairman of the committee devoted to this unprecedented campaign…
To start, could you share with our readers a little about yourself and your dedication to Hunts Point Market?
A: I’ve been in business 30 plus years now, third generation. I started on the docks working for my grandfather loading 100-pound bags of potatoes from railroad cars. It’s the only way to learn the business, from the ground up, Produce 101… from a foreman, I jumped to a salesman, where I was led into the office to talk to a shipper about buying something, and I continued to become more and more entrenched in the business.
We’re such a large market, there’s dynamic, day-to-day banter between merchants and customers; it’s a fast-paced, energetic business filled with colorful stories passed down through the generations.
Q: What are the goals of the new marketing campaign? Is this a first for Hunts Point Market?
A: Five months ago, our board of directors had this public relations committee, and it hadn’t gone anywhere. Co-President Mathew D’Arrigo asked me to take over the committee. We looked at the introduction of the new market in Philadelphia, and all the competition from the wholesale clubs in our area. We were losing business to these guys. We needed to put a new spin on the Market to let people know how friendly it can be.
Q: Did you see the inaugural edition of The New York Produce Show and Conference as a catalyst?
A: It started out about The New York Produce Show and Conference coming in November and how we would present our booth. It began to spiral from there. We produced a promotional video that we’re going to run, and we wanted someone to be our spokesperson.
We considered using people inside the industry, but then I saw the perfect guy, Tony Tantillo, on CBS News. He coins himself the Fresh Grocer. I fired off an email to him about being our spokesperson for the Market. Soon after, I got a phone call and he invited me to visit him at the CBS office in Manhattan.
Tony Tantillo loves Hunts Point Market. His parents were wholesalers on the San Francisco Market. He’s charismatic, and while he’s not a native New Yorker, he’s got the New York vibe. Hunts Point Market has sponsorship of his segment on the daily show, brought to you by the New York markets, with farmers and our slogans.
This is not so much about a sales campaign to buy; we’re marketing a brand for the Market. I compare it to Boeing aircraft on T.V. Everyone knows the brand but is not going out to buy Boeing. This is not to get housewives to come to Hunts Point, but she can ask her grocer, “Did you get this from Hunts Point?”
Q: Will your video production work get much exposure?
A: The produce video is great and we just signed a contract with Time Warner. It will reach in the neighborhood of 3.5 million households, right through the tip of New Jersey. These are 30-second spots branding the market that Hunts Point is a great place to shop.
Q: Where do you see the most buyer attrition and why? Which buyers are you trying to woo back? And how will this effort attract new customers?
A: Restaurants and grocery stores go to wholesale clubs, but can only buy what they are featuring that day, maybe Class A lettuce, where if they come to Hunts Point Market, not only do they get the largest selection of all the different lettuces, but also a variety in qualities and price points, which can vary from one end of the spectrum to the other.
These wholesale, price clubs have special hours where customers normally would come to Hunts Point to go to shop. It’s not a matter of quality; it is about convenience.
People forget Hunts Point is the food distribution scene. We have meat and fish markets right here. We are beginning to discuss with the meat and fish markets about branding of this center. It’s an evolution.
Q: Is this type of marketing strategy something new for Hunts Point Market?
A: The produce industry has never gone this direction before and done public relations marketing. It’s smart if it works; it’s all new territory to the committee and board… nothing ventured, nothing gained. We hope it will reintroduce the Market to mid-line wholesalers, green grocers and it might open up a door or two.
Q: What are the key points you’re trying to convey through the video?
A: The video will be at the show. We’ll introduce the video at the breakfast, which we are co-sponsoring, and then it will play all day at the booth. It came out fantastically. The images show things on many levels, introduces you to Hunts Point, shows a visual of the Market and the wide range of available product, and some history about its roots in the Washington Market. Overall, it gives you a welcoming feeling to shop for price, quality and variety.
Q: Could you put into perspective the size and scope of the Market?
A: I say Hunts Point Market is the Macy’s of Harold Square for food distribution. Philadelphia’s doesn’t handle near the volume. We estimate generating a little over two billion dollars a year in volume.
Q: Will your marketing campaign capitalize on the Internet and tap into other forms of social media?
A: We’ve also introduced a website, another new forey of marketing the Market. The website will give you daily updates on the Market, and feed into Face Book and Twitter. People can apply for credit applications, see lists of vendors, and a number of our shippers are partnering up with links on our website. You can come and advertise with Hunts Point Produce Market. It’s another avenue the Market has taken, and it’s a sophisticated, interactive website: HuntsPointProduceMkt.com
Q: Attendees to The New York Produce Show and Conference will include federal, state and local government officials. Could you make a case to them about the Market’s significance?
A: The Market has 3,500 well-paying union jobs with good benefits, health, pension, welfare. We keep an affordable food supply available to the masses of the New York region. Based on ethnicities and the cultural make-up of New York City, the Market lends itself to all these areas, where a price club is more focused.
A city dweller doesn’t need a crate of paper towels. When it comes to urban areas of New York, it’s the green grocer that is really king, where a consumer can buy one tomato or three potatoes, or a head of lettuce. You don’t have to buy six pounds of peppers. It’s all about the quality of the product; no one wants to waste.
With the consolidation of the large supermarket chains in New York, you only have one or two wholesalers supplying these larger chain stores. There used to be 15 or 20 supermarkets, but with the reduced numbers, supply is now all coming out of C&S, one distribution center, which makes it less competitive.
Q: There will be plenty of chain buyers at the show. How could they benefit from Hunts Point Market?
A: The idea of Hunts Point being a high-level sponsor at this trade show is partly to get bigger retailers to realize they don’t need to buy everything in big quantities on contract. Taking advantage of the spot market on a day-to-day basis could save them 30 percent.
Why do they always have to overbuy with contracts? It seems economies would dictate a different approach. There used to be street buyers. That is what made Waldbaum’s great, because they could bring the best value to consumers.
We don’t know six months out there will be a glut of honeydews. In a contract, say the big chain buyer paid $13, but in this Hunts Point scenario they’d get them for $7. These buyers are missing all the great bargains, and consumers are missing out too and forgetting what fresh is about.
Why are some of the small chain stores making such a big splash in these areas? They’re putting out good produce and getting paid for it by giving consumers what they want.
Consumers are finding delicious Hunts Point Market produce from a street vendor down the block for half the price and wondering why they can’t get it from their local supermarket. Why should there be anything that’s not the best being served to the consumer?
Q: How does this marketing campaign play into the long-time discussions about building a new market?
A: A new market may not be out of the question for Hunts Point, but as we weigh the issues involved in a $300 million or $400 million investment, we are still continuously improving what we have and being the best at what we are. That’s the spirit we’re bringing forth.
Q: As attendees unfamiliar with the Hunts Point Produce Market make their way to The New York Produce Show and Conference; do you have any last minute thoughts that might be helpful for them?
A: My only words of wisdom are come and shop at Hunts Point. You don’t know what you’re missing.
Whether you are a buyer or a seller, if you are in New York, you owe it to yourself to see Hunts Point. The New York Produce Show and Conference is making it easy to do that by incorporating the market into our regional tour program on Thursday, November 11, 2010.
You can learn more about the event by looking here.
You can register for The New York Produce Show and Conference right here
Or just sign up for the tour of Hunts Point right here.
We recommend signing up in advance so as to avoid waits and to guarantee a place on the tour, but you certainly can also sign up at the show registration desk starting on Tuesday after 4 pm at the Hilton New York.